Opening Gates | Two Keys to Profitable Growth

Two Keys to Profitable Growth

  • Posted by Judy Reynolds 27 Jan
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Two Keys to Profitable Growth

Less is often more

 

1.  Fewer Focused Strategies 

 

In a difficult market it is very tempting to embrace all of the sales opportunities – to have lots of options – to cover all bases.

There is a wise saying – “If you chase two rabbits, you won’t catch either”.

Having too many priorities often leads to a decline in profitable growth – with so many demands on our time we tend to be doing lots of things poorly as opposed to a few things well – we call this the scatter gun approach.

Consider the reverse – choosing a deliberate and focused set of strategic priorities (one to three) is more likely to lead to growth which adds to the bottom line.  This way time and energy is invested in a more intentional way.

The focus should be on the opportunities where your business will excel, which are on purpose to the vision you have for your business and congruent with why you do what you do.  The key is to turn down opportunities which may on the surface appear appealing and may create lots of activity but require more resources and contribute very little to or erode profit levels.  Don’t confuse increased activity with increased profit.

 

2. Prioritising People and Product

 

Another mistake often made in the excitement of creating growth strategies is to prioritise the development of a new product or service for a completely new market.  This growth strategy is often the least profitable option and the most time consuming.

The Product Customer Matrix is a very simple but very effective tool which compares the ease and the cost of generating new sales.

Product Customer Matrix

Let’s consider each quadrant, one through to four.

  1. It is most effective to market your current products and services to your current customers.  How many of your customers know everything you currently do or sell?  You know your current products/services and can confidently articulate the value to your customers.  You already have a relationship with your current customers and therefore they are more likely to be receptive to your recommendation.  So consider what needs to be done to educate your current clients about your current products.
  2. The next best option is to sell new products or services to your current clients. Again you have the relationship with these clients, a degree of trust already exists and they will be more amenable to your introduction to a new service.  Remember to ask your current customers for advice and feedback before developing new products or services – make sure that the need does in fact exist. See our Customer Collaborative workshops.
  3. Following this is… marketing existing products to new customers. Although you don’t know your prospective customer, you do know your product and can clearly communicate its benefits and this is an advantage.
  4. It is, however, more difficult to sell new products to a prospect – to someone with whom you have no trading history.

In summary…

Less is more – focus on one to three growth strategies at a time and ensure the outcome is in line with the vision you have for your business

Aim for profitable growth – growth for growth sake is working harder not smarter. Find out where your focus should be by referring to the Product Customer Matrix and use it as point of reference when planning growth strategies.

To download the Product Customer Matrix for Free (valued at $197)

CLICK HERE

 

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